To “live within your means” means that you spend less than (or at least equal to) the amount of money you bring in each month.
For many people, it’s a lot easier said than done.
Credit cards, loans, savings, and even emergency funds allow you to buy more things than your income would allow, and that’s incredibly luring to many people.
However, spending beyond your means will never make you happy. In fact, it’s likely that you’ll feel less joyful, knowing the amount of debt you carry.
Here’s how you can live within your means for a more joyful life.
- Spend less money than you bring in.
Sometimes budgeting in a stressful financial situation is overwhelming. Try “backwards budgeting.” Write down your income, then start subtracting each expense you pay each month. If you get to a negative number, you’re spending too much.
- Increase your income.
It may be time to get a higher paying job or even a second job to help make ends meet. The key is to do what you need to do to make enough money to pay all your necessary expenses, and get rid of your debt in the process.
- Stop relying on credit cards.
When you plan your budget, completely rule out credit cards. Credit cards are unreliable and only contribute to debt through relaxed spending.
- Save up for big purchases instead of putting them on credit.
People often use credit cards for large purchases they can’t afford to pay for outright, like a new television. Instead, put aside some money each month until you’ve saved up enough to buy it outright.
- Start an emergency fund.
An emergency fund of three to six months of living expenses is ideal, but starting out with $100-$200 will help with minor emergencies. Start small if you have to!
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